Rating (Property in Common Occupation) and Council Tax (Empty Dwellings) Bill

Jim McMahon Excerpts

3rd reading: House of Commons & Report stage: House of Commons
Tuesday 15th May 2018 Commons Chamber

[Jim McMahon (Oldham West and Royton) (Lab/Co-op)]

I thank the Minister for the constructive and positive way he has approached the Bill, from the early conversations about the technicalities to his contributions in Committee, and I repeat his thanks to the Committees that have worked in the background on this. It is clear that a lot of work has been done to engage and to iron out the wrinkles in the Bill. I hope this reinforces the offer we made some time ago that, where measures are not controversial and have the support of the sector, we will work constructively to take them through Parliament. I hope this will be the first of a number that local government wants to see come forward.

I do not know whether it is in order to refer to a previous stage, Madam Deputy Speaker, but I thought the hon. Member for Perth and North Perthshire (Pete Wishart), who is not in his place, took something of a liberty in the Legislative Grand Committee in trying to hijack a debate that affected English parliamentarians and English constituencies for what is an age-old debate about English votes for English laws. It almost belittles the detailed work done in many Committee sittings, where the hard work of making law has been happening but in a more constructive and mature way. I would not want us to lose sight of that. People watching on television—if anyone was watching it—might have been left with the inaccurate impression that Parliament was not doing its job and that this is a superficial way to pass laws, which is not the case at all.

Turning to the Bill, we support the measures relating to the staircase tax and the Supreme Court ruling. We recognise that it was a quirk of the system when the matter went to court and that it was not the original intention of legislation, but there remains concern about the financial impact on local authorities. In private meetings and in Committee, we requested a breakdown of the implications for each local authority in the country, but we have not to date had that information and so have not been able to assess the impact of this financial change on each local authority.

The Government will say that that is because the Supreme Court ruling meant that some local authorities were, for a short period, financially better off than had the ruling not been given, but many councils set their budgets based on that financial information, so some will face a net loss when, because of this change, money they were expecting from business rates does not come in. For some, the loss might be very minor, but for others it could be significant, depending on the make-up of properties within their local authority area. It would therefore have been reassuring to see that list today.

The agreement between central and local government is that, where central Government makes a change to the financial settlement and rules and regulations that has a net effect on local government budgets, councils ought to be compensated. Local Government and the Local Government Association—I declare an interest as vice-president of the LGA—are concerned about what it means when the Government make changes that can materially affect the financial base of local authorities but then do not provide financial compensation. Notwithstanding that, we recognise that the Government have heard the calls from business and ratepayers and have taken action. That should be welcomed.

Empty properties are a big issue. There are around 200,000 empty properties in this country at a time of a housing crisis. We know that 120,000 children in this country are without a permanent home and living in temporary accommodation. So the housing crisis is very real. Part of the problem with the Bill is that it addresses some types of empty property but not others. About 20% of properties in parts of London are empty. They are owned by wealthy individuals and institutions that will not be put off by a 100% additional council tax payment requirement, because that is pennies in the scheme of the wealth they hold. It might affect small landlords and people renovating properties, but it will not necessarily affect the part of the UK that arguably has the biggest housing crisis, and that of course is London. If the Government come forward with new proposals to address the problem of foreign individuals owning properties they have no intention of ever living in or allowing others to live in, the shadow Housing team would be open to a discussion on that.

I am aware that there is a housing debate to follow and that a great many Members have applied to speak in it. I repeat my thanks to the Government for being constructive and for engaging in the process at an early stage. I also repeat the offer of what we know local authorities want: far more cross-party working on matters that affect local government as a whole.